Construction all risks (CAR) insurance for foundation work
Foundation work sets the ground in motion, and that movement does not stop at the boundary. The heaviest claims in this trade come from buildings you have never set foot in.
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In brief
Driving piles, vibrating in sheet piling, excavating and dewatering set the subsoil under neighbouring buildings in motion. Cracks, sticking doors and dropped thresholds next door are liability claims under section 2, with Article 6:162 of the Dutch Civil Code as the basis. On inner-city work that, far more than damage to your own works, is where the money lies.
Dewatering is a risk of its own, because it works slowly. If you lower the groundwater table, wooden pile heads under surrounding buildings can be left dry. The deterioration that then begins becomes visible years later, when your project policy has long since expired. The question of which policy is then on the hook is best answered before the first pump runs.
Your own works — the excavation, the piles, the sheet piling, the foundation under construction: falls under section 1. A collapsing slope, a flooded excavation and a damaged pile belong there. If the work then goes into the ground for cables and pipes, also read the page about civil engineering, road and hydraulic works.
What does CAR insurance for foundation work cover?
The structure of the cover in three parts, with an overview per situation below.
Section 1
The works
Damage to the works themselves during construction or installation.
Fire, storm and water
Theft of materials
Inherent defect and design fault
Vandalism on the building site
Section 2
Liability
Damage to property and persons of third parties on and around the works.
Adjoining premises
Injury to bystanders
Cables and pipes
Optional
Extensions
What comes into play alongside the works themselves.
Client's existing property
Ancillary plant and site huts
Maintenance period
What is covered
Situation
Works section
Liability section
Storm or water damage to the works in progress
Yes
No
Theft of materials from the building site
Sometimes
No
Damage to an adjoining building
No
Yes
Injury to a bystander
No
Yes
The client's existing property
Sometimes
Sometimes
Repair of your own defective work
No
No
This overview is general in nature and is not personal advice. What is actually covered, including exclusions, limits and the excess, is set out in the policy conditions and the insurance card (verzekeringskaart) of the insurer; you receive both before you take out cover. Taking out cover without advice? Then read what execution only means for you.
Where things go wrong in practice
Four points that make the difference between a policy that pays out and one that does not.
Without a baseline survey you lose the argument
Before the first vibration, have a structural survey made of all buildings within the zone of influence: photographs, crack widths, and where necessary measuring bolts and level readings. Settlement damage is almost always reported after the event, and old cracks look the same after your work as new ones. Without a survey beforehand you cannot rebut anything, and your insurer then pays for the damage that was already there too.
Vibration monitoring is evidence, not bureaucracy
Continuous monitoring while driving or vibrating in piles shows that you stayed within the limit values adopted. That is your strongest document when a claim is made, and on inner-city work insurers increasingly set it as a condition in the policy. Measure on the facades that are closest, not at an easily accessible point, and keep the data at least as long as the liability can run.
Dewatering goes on working after you have left
Lowering the groundwater can damage wooden pile foundations in the surrounding area, and that damage only comes to light after years. Monitor the level with standpipes, consider recharge wells and record the readings. Also look at the run-off period of your policy: a claim that comes in after the cover has ended does not automatically fall under anything. Pass such a notification on immediately, as Article 7:941 of the Dutch Civil Code requires.
What foundation work does not get paid for
A pile set out of true or too shallow you have to put right yourself. That is your own work. If the damage follows from a choice in the geotechnical advice or the pile calculation, that is a design matter belonging with the consultant and their professional indemnity insurance. Contamination of soil or dewatering water falls under environmental damage insurance. And no construction policy pays the client's delay penalties.
Existing property is the most commonly missed section
If you work in or on an existing building, that building is not your works but the property of the client. Damage to it does not fall under section 1 and, on your AVB, falls under the care, custody and control exclusion. The section existing property fills that gap, and with conversions, renovations and installation work that is not an edge case but the core of the risk.
The maintenance period continues after handover
After handover there is often a maintenance period during which you remain liable for defects that arose during construction. Agree that period explicitly and have it stated on the policy. Under the Wet kwaliteitsborging (the Dutch Building Quality Assurance Act) this carries more weight: Article 7:758(4) of the Dutch Civil Code places the burden of proof for hidden defects on the contractor.
What does your premium depend on?
Foundation technique used. Driving and vibrating transmit far more vibration than boring, screwing or pressing.
Distance to the buildings. The closer the adjoining properties, the greater the chance that movement in the ground becomes visible there.
Condition and foundations of the surrounding buildings. Old buildings on wooden piles are more sensitive to vibration and to changes in the groundwater table.
Dewatering and its duration. The longer and deeper you lower the level, the further the effect reaches and the later it becomes visible.
Depth of the excavation. A deep excavation with sheet piling and props is a heavier risk than a shallow trench on firm ground.
Limit and run-off in section 2. Because damage emerges late, not only the amount but also the term of the liability cover matters.
Insurers weigh these details differently. That is where your saving is.
How we arrange it
You request a quoteWe take stock of your situation, your risk and your wishes.
We compareseveral insurers, on premium as well as conditions.
You receive a proposalWith an explanation of the differences and the exclusions.
We arrange the switchIncluding cancellation, so there is no gap in cover.
Customers rate our service on four aspects: personal service, service delivery, availability and the outcome. The reviews are collected and published by NH1816 and come from customers who have actually taken out a policy with Finass Advies B.V. or reported a claim.
The neighbours only report a crack a year later. What should I do?
Report it to your insurer immediately, even if you think the claim is unfounded and do not yet know the extent; Article 7:941 of the Dutch Civil Code requires notification without unnecessary delay. Send the baseline survey with it. On a policy based on the moment of the event, the construction period is decisive and not the date of the complaint, but you do have to be able to prove that.
Is pile rot caused by my dewatering insured?
In principle it is a liability claim under section 2, because you are causing damage to someone else's property. The practical question is whether the deterioration comes to light within the term or run-off period of your cover, and whether it can be shown that the lowering came from your work. Standpipe data and the baseline survey are decisive there, not your good intentions.
Is a structural survey compulsory?
Not by law, but insurers often include it as a condition in the policy for inner-city foundation work. Even without such a clause it is unwise to skip it. Without a baseline survey you cannot rebut a claim, existing damage is put down to your work, and your claims burden rises, with consequences for your premium at renewal.
A pile has settled out of true. Does the policy pay for resetting it?
No, that is repair of your own work and it remains a business risk. Otherwise the policy would guarantee the quality of your workmanship. What does count is the consequential damage: if the failure damages the excavation, the slope collapses or an adjoining building suffers damage, that belongs in section 1 and section 2 respectively.
Finass Verzekert is a trading name of Finass Advies B.V. We advise on and arrange non-life insurance on the basis of an objective analysis of several insurers, and receive commission for this from the insurer, which is included in the premium. You pay no separate advice fee. Before you take out cover, we establish your wishes and needs.
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